With over 1,250 establishments in 95 countries, Radisson Hotel Group is one of the world’s largest in the industry. Here, global CIO Jaime González-Peralta reveals why technology is integral not only for the company’s future but for the entire sector.
With stints at Procter & Gamble, HPE and DHL, Jaime González-Peralta landed at Radisson Hotel Group four years ago as CIO for EMEA and then became global CIO in April 2020 — a particularly complex moment due to the paralysis that the pandemic inflicted on the world of travel.
During this time, thanks to the period of reflection the health crisis afforded and the opportunity to dedicate time to innovate, González-Peralta initiated a stronger shift to technology and digitalization to better realize the transformation plan the multinational started shortly before his arrival. So now, he says, more than 90% of the company’s business initiatives are possible through the tech borne out of the IT area he leads.
Having led Radisson Hotel Group’s IT on a global scale for more than three years, what milestones have you achieved?
When I joined the group in June 2019, there were two decision-making centers: Americas and the rest of the world. They collaborated with each other, but before the pandemic, in Q1 of 2020, I became global CIO and brought together both organizations. Then in March, the pandemic hit and hotel activity stopped, but it gave us the chance to accelerate the company’s transformation and digitalization process that started in 2018 with a five-year plan. Until then, the IT part of Radisson was considered a cost center, but thanks to that plan, it became a central pillar of the group’s strategy.
Also during the pandemic, we completely restructured and created every IT element the company needed: new ERP, purchasing systems, hotel management systems, and HR systems, for example. We closed three of our own data centers and went entirely to the cloud with several providers, and we also assembled a new data strategy to completely restructure the company, from security and finance, to hospitality and a new website. We made everything new from scratch.
Our owner, Jinjiang International, set us a very clear objective: to move from systems created in the 80s that are difficult to maintain to modern ones. And in just eight months, we were able to put 80% of our platforms on current technologies.
From an organizational standpoint, we evolved to a nearshore model, attracting the necessary talent that new technologies required. And we did it not only to be closer to operations, but to take advantage of the potential that Spain offers in human capital within the tourism sector. More than half of the IT organization joined the company in 2020, so we basically had to build a plane in flight.
How have you rebuilt all the IT talent?
With that, we adopted an onshore model and created a center of excellence in Madrid where we manage all operations and lead all implementation projects worldwide. This center has 350 professionals of more than 40 nationalities. But it’s comprised not only of IT professionals but people in purchasing, HR, finance, architecture, and revenue management, for example.
How many people, then, make up Radisson’s IT area worldwide?
About 90. And the question that arises is, why are there only 90 to manage over 1,000 hotels around the world. Because we also took advantage of all this change to adopt a higher level of outsourcing that we’ve addressed with the EY team, which has been key in this process.
Implementing such significant change, it must have been difficult to get rid of legacy systems.
It was a brave and confident decision. We were clear that IT — both from the point of view of applications and infrastructure — security, and data, were in the company’s DNA. Our CEO, of course, was very clear about this vision.
This plan covers from 2018 to 2023. What has been the overall investment in IT and what is the next step?
I can’t reveal details of investment, but it’s been substantial. We’re already starting the next plan to evolve the revenue management systems to reach the level of sophistication we’re looking for thanks to the application of machine learning.
Traditionally, companies in the hotel sector have focused on implementing various modular solutions connected to each other. But the decision that Radisson made was to use only one system with a customer database. This has dramatically reduced the level of integration and change management required, while allowing us to increase agility when facing challenges. Plus, having the support of the entire company in this technological transformation has been essential because when you make such a big change, it affects people, systems, and procedures.
You mentioned assembling a new data strategy to restructure the company. Why is data so critical to your IT vision?
I like to call the IT department ‘information decision systems.’ Our differentiation doesn’t come from managing functional solutions but from systems allowing us to have information so we can adapt. Explaining the past is complicated, but it’s more complicated to predict the future and know exactly what actions we should take to influence it. We have 900 people who use decision-making tools based on fully certified data. For us this is fundamental. Plus, we’ve moved to data-driven execution. For instance, hotel directors and department heads all have dashboards where they have the information they need to control and predict the future and make decisions.
One of the missions within IT is to push technology to the maximum so users, both in hotels and in central offices, can free up time to dedicate to more valuable tasks.
Are you already working with generative AI?
A challenge for any CIO or company is to maintain focus. Radisson maintains the focus on the strategic plan that’s been set and this makes us unique. That said, a small group within the company is looking at innovation. We have an innovation committee made up of operations, finance, and IT where we explore emerging technologies. We’re not afraid to try them. In fact, we do it quickly to fail or succeed quickly. This is what happened with RPA. We tested it three years ago, saw its usefulness, and now we have an RPA factory for the entire company.
When it comes to AI, though, we’re cautious. We’re analyzing the maturity level and have a private testing environment with Microsoft to see how we can benefit from it in the short term, especially in terms of interaction with users. Looking to the future, we’re convinced that user search for hotels will drastically change, not only because of the greater volume of searches that will be done but of searching itself, which will be different. And this is what we are investigating now.
From the point of view of the company’s objectives, we continue with this five-year period, but from the prism of the IT area, we work on a horizon of three years at most, ideally two. Only then can we make decisions I won’t regret in the near future.
How do you see the future of the hotel and tourism world with all these technological changes?
It’s exciting. We have impressive growth plans enabled by technology. This helps us go faster, be more efficient and decrease the cost of change or transformation. We’re putting focus on systems by and for people, and this creates constant dialogue between the IT and business areas.
Technology impacts what the hotel of the future will be like. It’ll be smarter in its relationship with users, but also more efficient in terms of its own infrastructure, water consumption, and energy.
In our sector, we manage emotions and it’s a relationship of trust that customers place in the brand. If the user goes to a website and doesn’t find the information he wants, how he wants it, and in a reasonable time, he goes to the competition. So an important investment we’re making is how we present ourselves to the customer, creating immersive experiences, improving our website and our app, for example. We want to personalize the client’s needs as much as possible.
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